China Food & Drink Report

Published 12 February 2015

  • 107 pages
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China Food & Drink Report

Over the next five years, we see three trends in private consumption for the major emerging markets in Asia. China will see some of the fastest growth rates in the region. We forecast average annual real private consumption growth of 8.0% over the next five years. These high growth rates chime with the rebalancing of the economy towards greater private consumption and, as such, will see private consumption growth remain strong, despite our forecasts for a slowdown in the overall economy's real growth rate to below 7.0% over the coming years.

While the outlook for China's traditional economic growth drivers such as heavy industry and real estate construction remains cloudy, the outlook facing the more consumer-focussed industries is relatively strong over the medium term. Overall, though, as the traditional sectors remain the dominant drivers of the economy, we remain below consensus in our real GDP growth outlook, and caution that the inevitable bursting of the ongoing credit bubble could also serve to undermine the profitability of the consumer-focussed industries.

Headline Industry Data

  • 2015 food consumption local currency = +7.5%; compound annual growth rate (CAGR) forecast between 2014 and 2019 = +9.1%.

  • 2015 beer volume sales = +6.1%; CAGR forecast between 2014 and 2019 = +5.6%.

  • 2015 mass grocery retail sales (local currency) = +7.8%; CAGR forecast between 2014 and 2019 = +8.8%.

Key Industry Trends

Dunkin' Donuts Sets Out Ambitious Expansion Plan : In January 2015, it was reported that the coffee and baked goods chain Dunkin' Donuts planned to open 1,400 new stores in China in the next 20 years in a bid to increase its brand presence in the country. The doughnut chain has signed a franchise agreement with Golden Cup, a joint venture between Jollibee Worldwide and Jasmie Asset Holding, the latter being a subsidiary of RRJ Capital Master Fund II. Dunkin' Donuts currently has 16 branches in China, while it has a total of 2,200 stores across the...

Table of Contents

BMI Industry View
7
SWOT
8
Food
8
Drink
10
Mass Grocery Retail
11
Industry Forecast
13
Consumer Outlook
13
Food
15
Food Consumption
15
Table: Food Consumption Indicators, 2011-2018
16
Canned Food
16
Table: Canned Food Value/Volume Sales, 2011-2018
17
Confectionery
17
Drink
19
Hot Drinks
19
Table: Hot Drinks Value/Volume Sales, 2011-2018
20
Alcoholic Drinks
20
Table: Alcoholic Drinks Value/Volume Sales - Historical Data & Forecasts, 2011-2018
21
Soft Drinks
22
Table: Soft Drinks Value/Volume Sales, 2011-2018
23
Mass Grocery Retail
25
Table: Mass Grocery Retail Sales, 2011-2018
26
Trade
27
Table: Trade Indicators, 2011-2018
28
Macroeconomic Forecast
29
Economic Analysis
29
Table: China - Economic Activity
33
Industry Risk Reward Ratings
34
Asia Pacific Risk/Reward Ratings
34
Table: Asia Pacific Food & Drink Risk/Reward Ratings Q314
36
Table: Asia Pacific Food & Drink Risk/Reward Sub-Factor Ratings Q314 (scores out of 10)
39
China Risk/Reward Ratings
40
Market Overview
41
Food
41
Food Production
41
Instant Noodles
41
Confectionery
42
Trade
42
Agriculture
42
Dairy
43
Organics
45
Drink
46
Soft Drinks
46
Hot Drinks
48
Alcoholic Drinks
49
Mass Grocery Retail
54
Leading Players
55
Industry Trends And Developments
59
Food
59
Key Industry Trends And Developments
59
Drink
64
Key Industry Trends And Developments
64
Mass Grocery Retail
69
Key Industry Trends And Developments
69
Competitive Landscape
71
Table: Key Players In China's Food & Drink Sector
71
Table: Key Players In China's Mass Grocery Retail Sector
71
Company Profile
73
Hsu Fu Chi
73
Tingyi (Cayman Islands) Holding
76
China Foods Ltd
79
Nestl- China
82
China Mengniu Dairy
85
Tsingtao
87
Wahaha
90
Kweichow Moutai
93
Carrefour
95
Sun Art Retail Group
97
Global Industry Overview
99
Table: Food And Drink Core Views
111
Demographic Forecast
112
Table: China's Population By Age Group, 1990-2020 ('000)
113
Table: China's Population By Age Group, 1990-2020 (% of total)
114
Table: China's Key Population Ratios, 1990-2020
115
Table: China's Rural And Urban Population, 1990-2020
115
Glossary
116
Food & Drink
116
Mass Grocery Retail
116
Methodology
118
Industry Forecast Methodology
118
Sector-Specific Methodology
119
Sources
119
Risk/Reward Rating Methodology
120
Table: Food & Drink Risk/Reward Rating Indicators
121
Table: Weighting
122

The China Food & Drink Report features Business Monitor International (BMI)'s market assessment and independent forecasts for food and drink expenditure, consumption, sales, and imports/exports and forecasts for the mass grocery retail sector. The report also includes analyses of major regulatory developments, the background macroeconomic outlook and competitive landscape comparing national and multinational companies by leading products and services, sales, investments, partners and expansion strategies.

BMI's China Food & Drink Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the food and drink industry and the mass grocery retail market in China.

Key Benefits

  • Benchmark BMI's independent food and drink industry forecasts for China to test other views - a key input for successful budgeting and strategic business planning in the Chinese food and drink market.
  • Target business opportunities and risks in China through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
  • Exploit latest competitive intelligence on your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity) and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts and views, covering food and drink manufacturing and consumption and the mass grocery retail market.

Industry SWOT Analysis

Analysis of the major strengths, weaknesses, opportunities and threats within the food, drink and mass grocery retail sectors and within the broader political, economic and business environment.

BMI’s Food and Drink Risk Reward Index

BMI’s Risk Reward Index provides investors (food and drink manufacturers and mass grocery retailers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic points. These provide indices of highest to lowest appeal to investors, with each position explained.

Food Forecasts

BMI’s food chapter is divided into sections such as meat, fish, confectionary, dairy and canned foods, and provides insight into each market’s food industry, centred on a forecast to end-2019 for the sector. The chapter includes the following elements:

  • Industry Forecast Scenario: Historical data series and a forecast to end-2019 for growth of key indicators within a market’s food industry. Indicators include food consumption, food consumption as % of GDP, canned food sales, confectionery sales and food and drink imports and exports, among others.
  • Industry Developments: A summary of corporate developments, including news on M&As, FDI, expansions, closures and financial results, in addition to analysis and explanation of the latest industry events and how these could influence further investment.
  • Market Overview: An overview of the structure of the market, introducing the key players and discussing underlying trends.

Drink Forecasts

Segmented the same way as BMI’s food chapter, the drink section provides insight into each market’s drink industry, centred on a forecast to end-2019 for the sector. Forecast indicators include alcoholic and soft drink sales by value, volume and sub-sector and tea and coffee sales, among others.

Mass Grocery Retail Forecasts

Segmented the same way as BMI’s food and drink chapters, the mass grocery retail section provides insight into each market’s grocery retail industry, centred on a forecast to end-2019 for the sector. Forecast indicators include mass grocery retail sales by format (including supermarkets, hypermarkets, convenience and discount stores) and a breakdown of the organised retail sector versus the traditional sector, among others.

Competitive Landscape

Illustration of the mass grocery retail and food and drink industries via rankings tables comparing revenues, number of outlets and number of employees. This chapter also includes data-rich, in-depth regional analysis of the market position, business strategies and investment potential of the region’s leading mass grocery retail and food and drink operators.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Food & Drink reports draw on an extensive network primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc